What’s Next for Juniper Stock Now That the HPE Merger Is Approved?
Juniper Networks (NYSE: JNPR) shares edged up to $39.95 after the U.S. Department of Justice (DOJ) agreed to settle its antitrust lawsuit, clearing a key obstacle to Hewlett-Packard Enterprise’s (NYSE: HPE) $14 billion all-cash acquisition of Juniper. As part of the agreement, HPE will divest its Instant On wireless networking unit and grant limited access to Juniper’s Mist AI source code—a core part of its WLAN portfolio. While this removes the biggest regulatory barrier, the deal still requires final court approval and a 60-day public comment period, pushing the likely close to Q3 2025. That said, those seeking growth with less volatility than individual stocks might explore the High Quality portfolio, which has outpaced the S&P 500 with returns exceeding 91% since inception.
Image by Luke Robertson from Pixabay
A Year in the Making
Announced in early 2024, the acquisition is central to HPE’s strategy to expand its AI-driven networking footprint and compete more aggressively with Cisco Systems (NASDAQ: CSCO). The DOJ initially sued to block the deal in January, arguing it would reduce competition by leaving Cisco and HPE with a combined 70% share of the U.S. networking hardware market. Juniper countered, claiming the DOJ’s market definition was flawed and that the deal would foster—not hinder—innovation. Under the settlement, HPE agreed to offload Instant On and license Mist AIOps technology to rivals—concessions rarely seen in tech M&A.
- Juniper Stock Up 27% in 2024. What’s Happening?
- What To Expect As Juniper Publishes Its Q3 Results?
- What’s Driving The Surge In Digital Infrastructure Stocks?
- What To Expect From Juniper Networks’ Q1 Earnings?
- What’s Happening With Juniper Stock?
- Here’s How Juniper Networks Stock Strongly Outperformed The Broader Markets!
What This Means for Investors
Once the deal closes, Juniper shareholders will receive $40 in cash per share. With the stock trading just below that price, upside is now limited unless the deal faces unexpected delays. For HPE investors, attention turns to integration and execution. Analysts expect the combination to be earnings-accretive within the first year, with synergies driven by scale and Juniper’s AI-native networking tools, which will be folded into HPE’s Aruba Networking unit.
Strategic Stakes
While some critics argue the deal reduces market competition, HPE CEO Antonio Neri sees it as a strategic leap, strengthening HPE’s position across AI data centers, cloud environments, and telecom networks. For enterprise customers, the outcome offers a deeper product portfolio and enhanced AI capabilities, though at the cost of reduced vendor diversity. Much now depends on how well HPE integrates Juniper—and how effectively competitors capitalize on Mist AI’s partial unbundling.
HPE Valuation Check: Still Looks Cheap, But for a Reason
Despite trading at just 0.9x sales and 20.2x earnings—well below the S&P 500’s 3.1x and 26.9x—Hewlett Packard Enterprise’s sky-high price-to-free cash flow ratio of 252.7 underscores weak cash efficiency. While revenue has grown 4.5% annually over the past three years and 11.8% in the last year, profitability remains thin, with operating and net margins of just 7.0% and 4.6% over the past four quarters, far below the S&P 500’s 14.9% and 11.6%.
Bottom Line
With the DOJ hurdle cleared, Juniper stock is essentially locked at $40. The focus now shifts to court sign-off, execution on divestitures, and signs of synergy in upcoming earnings. For investors, the biggest returns are now likely to come via HPE’s post-merger performance.
Investing in a single stock can be risky. We apply a risk assessment framework while constructing the 30-stock Trefis High Quality (HQ) Portfolio, which has a track record of comfortably outperforming the S&P 500 over the last 4-year period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.
Invest with Trefis Market-Beating Portfolios